Medicare Loses $9 Million a Year by Counting Two Donated Lungs as One

Some bodily organs, like hearts and livers, come solo, while others, like kidneys and lungs, come in pairs—and that makes a big difference when a person with organ failure needs a transplant to survive. A spare kidney may be donated for transplant, but hearts come only from the dead. It also makes a difference to the accounting, as a new report shows the government loses about $9 million a year to miscounting of transplanted lungs.

The IG reviewed Medicare cost reports from Fiscal Year 2011 relating to 54 OPOs, 51 of them independent and 3 hospital-based. The 51 independent OPOs reported total organ costs of about $1.34 billion, including $391 million for reimbursable kidney costs and $88.6 million to procure 2,645 lungs. The 3 hospital-based OPOs reported $5 million for procuring 213 usable lungs.

The OPOs regularly miscounted the lungs, according to the IG report. Of the 54 OPOs, 44 (81%) reported lung statistics incorrectly by reporting double lung transplants as 1 organ, including 1 of the 3 hospital-based OPOs and 43 of the 51 independent ones.

The 51 independent OPOs understated the number of lungs procured by reporting 1,691 lungs instead of 1,691 lung transplants involving 3,382 lungs, while the hospital-based OPO reported 30 lungs instead of 60 lungs, according to the report.

As a result, the IG estimates that Medicare’s share of organ procurement costs was overstated by $8,851,018. The report attributes the miscounting to a lack of guidance from the Centers for Medicare and Medicaid Services (CMS), whose Provider Reimbursement Manual does not provide guidance on how to count the organs involved in a double-lung operation. The manual does, however, direct the OPOs to count both kidneys in a double-kidney transplant.

“Because lungs are in pairs,” the IG concludes, “they are procured as one or two organs and should be reported as such,” going forward to avoid future misstatements of Medicare costs. CMS, according to the report, agrees and intends to take steps to correct the problem.

Comments

Shabad O'Rourke
2 years ago

Wait, why do you say the OPOs miscounted lungs when they did it precisely the way CMS rules said organs were to be counted. You say yourself that CMS did "direct the OPOs to count both kidneys in a double-kidney transplant." The OPOs counted lungs the
same way they were told to count kidneys. Are you suggesting kidney counting should be different from lung counting? If so, what would be the biological reason for having math differences based on organ type?